Delhi Police denies Satya Pal Malik detained: What is the Reliance insurance scam case he is linked to

Some khaps from Haryana had decided to organise a show of support for Malik after his recent comments on the Pulawama attack. Malik has been vocal in support of farmers, including during the anti farm laws agitation.

On Friday, Malik was called by the Central Bureau of Investigation (CBI) to answer queries pertaining to an alleged Reliance insurance scam case.

Reacting to the summons, Malik told the news agency that the investigative agency has asked for his presence at its Akbar Road guesthouse next week. He said, “They want certain clarifications for which they want my presence. I am going to Rajasthan so I have given them dates from April 27 to 29 when I am available”.

The development has come just days after the former governor in an interview with Karan Thapar for The Wire claimed that after the February 2019 Pulwama attack, in which 40 CRPF personnel were killed, Prime Minister Narendra Modi had asked him to stay silent over some alleged lapses he raised.

In October 2021, Malik alleged that when he was the J&K governor, he was offered Rs 300 crore in bribes to clear two files. While he didn’t specify what files those were, one of these pertained to the government’s deal with Reliance General Insurance for providing health insurance to government employees. Malik had cancelled the deal in October 2018. The other matter referred to civil works relating to the Kiru Hydel Power Project.

This will be the second time that Malik would appear before the CBI regarding the matter. He was earlier questioned by the agency in October last year.

What happened after Malik’s allegation?

Five months after Malik’s claims, J&K Lieutenant-Governor Manoj Sinha said that his administration had decided to hand over the Reliance insurance and the Kiru Hydel cases to the CBI.

“There had been allegations of malpractices in awarding the contract of J&K Government Employees Health Care Insurance Scheme to Reliance General Insurance Company Ltd and awarding of the contract with respect to civil works of Kiru Hydroelectric Power project to a private firm. Reports in these matters were sought from the Finance Department and Anti Corruption Bureau… the competent authority in the J&K government has decided to refer these cases to CBI for investigation,” the UT administration’s letter to CBI said.

Subsequently, two cases were registered by the agency after which searches at 14 locations and booked Anil Ambani’s Reliance General Insurance Company (RGIC) and officials of Chenab Valley Power Projects Pvt Ltd (CVPPPL).

What are the allegations against Reliance?

Reliance General Insurance Company and Trinity Reinsurance Brokers Ltd have been mentioned as accused in one of two FIRs registered by the CBI. The FIR says that the allegations as pointed out by the UT administration “prima facie disclose that unknown officials of Finance Department of Govt of J&K by abusing their official position in conspiracy and connivance with Trinity Reinsurance Brokers Ltd, Reliance General Insurance Company Ltd and other unknown public servants and private persons have committed the offences of criminal conspiracy and criminal misconduct to cause pecuniary advantage to themselves and caused wrongful loss to the state exchequer during the period 2017 and 2018…”

The government at the time had floated tenders for group health insurance to government employees but received only one bid. It then hired insurance broker Trinity to float tenders on its behalf. Seven insurance companies made the bid, including Reliance, which eventually qualified. It was disbursed a premium of over Rs 61 crore by the state administration.

After Malik raised a red flag, the matter was examined by the state Anti-Corruption Bureau and Finance Department.

What did the J&K Anti-Corruption Bureau find?

After examining all issues regarding Reliance getting the tender — which included eligibility criteria being changed in the middle of the tendering process, non-transparent selection of the insurance broker, and the number of employees being artificially jacked up to provide benefits to Reliance — the ACB in its report dated November 27, 2021, stated that “no irregularity has been found out during the course of verification by the ACB”.

It only recommended a recovery of Rs 44 crore from Reliance as an excess premium since the contract was cancelled.

But the Finance Department, in a report on February 10, 2022, mentioned that there were irregularities in awarding the contract. These included the e-tendering process not being followed, change of criteria for re-tender after only one response was received to the first tender, changes in agreement with Trinity after it was already signed, and release of the first instalment of premium before the agreement was signed with Reliance.

It was after this that Sinha, in March 2022, announced to hand over the case to the CBI for further investigation.